Could The Patriot National Bancorp, Inc. (NASDAQ:PNBK) Ownership Structure Tell Us Something Useful?

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If you want to know who really controls Patriot National Bancorp, Inc. (NASDAQ:PNBK), then you’ll have to look at the makeup of its share registry. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. Companies that used to be publicly owned tend to have lower insider ownership.

With a market capitalization of US$57m, Patriot National Bancorp is a small cap stock, so it might not be well known by many institutional investors. In the chart below below, we can see that institutions are noticeable on the share registry. Let’s take a closer look to see what the different types of shareholder can tell us about PNBK.

View our latest analysis for Patriot National Bancorp

NasdaqGM:PNBK Ownership Summary, July 17th 2019
NasdaqGM:PNBK Ownership Summary, July 17th 2019

What Does The Institutional Ownership Tell Us About Patriot National Bancorp?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

We can see that Patriot National Bancorp does have institutional investors; and they hold 5.7% of the stock. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Patriot National Bancorp, (below). Of course, keep in mind that there are other factors to consider, too.

NasdaqGM:PNBK Income Statement, July 17th 2019
NasdaqGM:PNBK Income Statement, July 17th 2019

We note that hedge funds don’t have a meaningful investment in Patriot National Bancorp. We’re not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of Patriot National Bancorp

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

We can see that insiders own shares in Patriot National Bancorp, Inc.. In their own names, insiders own US$1.1m worth of stock in the US$57m company. It is good to see some investment by insiders, but I usually like to see higher insider holdings. It might be worth checking if those insiders have been buying.

General Public Ownership

With a 28% ownership, the general public have some degree of sway over PNBK. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Private Company Ownership

It seems that Private Companies own 64%, of the PNBK stock. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too.

I like to dive deeper into how a company has performed in the past. You can access this interactive graph of past earnings, revenue and cash flow for free .

Of course this may not be the best stock to buy. So take a peek at this free free list of interesting companies.

NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.

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If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.